diff --git a/demo/client.ts b/demo/client.ts
index 2590d4b0..09359905 100644
--- a/demo/client.ts
+++ b/demo/client.ts
@@ -559,7 +559,7 @@ function addDecoration() {
   const decoration = term.registerDecoration({
     marker,
     backgroundColor: '#00FF00',
-    foregroundColor: '#000000',
+    foregroundColor: '#00FE00',
     overviewRulerOptions: { color: '#ef292980', position: 'left' }
   });
   decoration.onRender((e: HTMLElement) => {
diff --git a/src/browser/renderer/BaseRenderLayer.ts b/src/browser/renderer/BaseRenderLayer.ts
index 67edcb02..b815c672 100644
--- a/src/browser/renderer/BaseRenderLayer.ts
+++ b/src/browser/renderer/BaseRenderLayer.ts
@@ -13,7 +13,7 @@ import { acquireCharAtlas } from 'browser/renderer/atlas/CharAtlasCache';
 import { AttributeData } from 'common/buffer/AttributeData';
 import { IColorSet } from 'browser/Types';
 import { CellData } from 'common/buffer/CellData';
-import { IBufferService, IOptionsService } from 'common/services/Services';
+import { IBufferService, IDecorationService, IOptionsService } from 'common/services/Services';
 import { isPowerlineGlyph, throwIfFalsy } from 'browser/renderer/RendererUtils';
 import { channels, color, rgba } from 'common/Color';
 import { removeElementFromParent } from 'browser/Dom';
@@ -52,7 +52,8 @@ export abstract class BaseRenderLayer implements IRenderLayer {
     protected _colors: IColorSet,
     private _rendererId: number,
     protected readonly _bufferService: IBufferService,
-    protected readonly _optionsService: IOptionsService
+    protected readonly _optionsService: IOptionsService,
+    protected readonly _decorationService: IDecorationService
   ) {
     this._canvas = document.createElement('canvas');
     this._canvas.classList.add(`xterm-${id}-layer`);
@@ -294,7 +295,7 @@ export abstract class BaseRenderLayer implements IRenderLayer {
    * @param bold Whether the text is bold.
    */
   protected _drawChars(cell: ICellData, x: number, y: number): void {
-    const contrastColor = this._getContrastColor(cell);
+    const contrastColor = this._getContrastColor(cell, x, y);
 
     // skip cache right away if we draw in RGB
     // Note: to avoid bad runtime JoinedCellData will be skipped
@@ -427,15 +428,35 @@ export abstract class BaseRenderLayer implements IRenderLayer {
     return `${fontStyle} ${fontWeight} ${this._optionsService.rawOptions.fontSize * window.devicePixelRatio}px ${this._optionsService.rawOptions.fontFamily}`;
   }
 
-  private _getContrastColor(cell: CellData): IColor | undefined {
-    if (this._optionsService.rawOptions.minimumContrastRatio === 1 || isPowerlineGlyph(cell.getCode())) {
+  private _getContrastColor(cell: CellData, x: number, y: number): IColor | undefined {
+    // Get any decoration foreground/background overrides, this must be fetched before the early
+    // exist but applied after inverse
+    const decorations = this._decorationService.getDecorationsOnLine(y);
+    let bgOverride: number | undefined;
+    let fgOverride: number | undefined;
+    for (const d of decorations) {
+      const xmin = d.options.x ?? 0;
+      const xmax = xmin + (d.options.width ?? 1);
+      if (x >= xmin && x < xmax) {
+        if (d.backgroundColorRGB) {
+          bgOverride = d.backgroundColorRGB.rgba;
+        }
+        if (d.foregroundColorRGB) {
+          fgOverride = d.foregroundColorRGB.rgba;
+        }
+      }
+    }
+
+    if (!bgOverride && !fgOverride && (this._optionsService.rawOptions.minimumContrastRatio === 1 || isPowerlineGlyph(cell.getCode()))) {
       return undefined;
     }
 
-    // Try get from cache first
-    const adjustedColor = this._colors.contrastCache.getColor(cell.bg, cell.fg);
-    if (adjustedColor !== undefined) {
-      return adjustedColor || undefined;
+    if (!bgOverride && !fgOverride) {
+      // Try get from cache
+      const adjustedColor = this._colors.contrastCache.getColor(cell.bg, cell.fg);
+      if (adjustedColor !== undefined) {
+        return adjustedColor || undefined;
+      }
     }
 
     let fgColor = cell.getFgColor();
@@ -453,13 +474,18 @@ export abstract class BaseRenderLayer implements IRenderLayer {
       bgColorMode = temp2;
     }
 
-    const bgRgba = this._resolveBackgroundRgba(bgColorMode, bgColor, isInverse);
+    const bgRgba = this._resolveBackgroundRgba(bgOverride !== undefined ? Attributes.CM_RGB : bgColorMode, bgOverride ?? bgColor, isInverse);
     const fgRgba = this._resolveForegroundRgba(fgColorMode, fgColor, isInverse, isBold);
-    const result = rgba.ensureContrastRatio(bgRgba, fgRgba, this._optionsService.rawOptions.minimumContrastRatio);
+    let result = rgba.ensureContrastRatio(bgOverride ?? bgRgba, fgOverride ?? fgRgba, this._optionsService.rawOptions.minimumContrastRatio);
 
     if (!result) {
-      this._colors.contrastCache.setColor(cell.bg, cell.fg, null);
-      return undefined;
+      if (!bgOverride && !fgOverride) {
+        this._colors.contrastCache.setColor(cell.bg, cell.fg, null);
+        return undefined;
+      }
+      // If it was an override and there was no contrast change, set as the result
+      // TODO: This is white when it should be green
+      result = fgRgba;
     }
 
     const color: IColor = {
@@ -470,7 +496,9 @@ export abstract class BaseRenderLayer implements IRenderLayer {
       ),
       rgba: result
     };
-    this._colors.contrastCache.setColor(cell.bg, cell.fg, color);
+    if (!bgOverride && !fgOverride) {
+      this._colors.contrastCache.setColor(cell.bg, cell.fg, color);
+    }
 
     return color;
   }
diff --git a/src/browser/renderer/CursorRenderLayer.ts b/src/browser/renderer/CursorRenderLayer.ts
index ea419cb2..3fa576a9 100644
--- a/src/browser/renderer/CursorRenderLayer.ts
+++ b/src/browser/renderer/CursorRenderLayer.ts
@@ -8,7 +8,7 @@ import { BaseRenderLayer } from 'browser/renderer/BaseRenderLayer';
 import { ICellData } from 'common/Types';
 import { CellData } from 'common/buffer/CellData';
 import { IColorSet } from 'browser/Types';
-import { IBufferService, IOptionsService, ICoreService } from 'common/services/Services';
+import { IBufferService, IOptionsService, ICoreService, IDecorationService } from 'common/services/Services';
 import { IEventEmitter } from 'common/EventEmitter';
 import { ICoreBrowserService } from 'browser/services/Services';
 
@@ -40,9 +40,10 @@ export class CursorRenderLayer extends BaseRenderLayer {
     @IBufferService bufferService: IBufferService,
     @IOptionsService optionsService: IOptionsService,
     @ICoreService private readonly _coreService: ICoreService,
-    @ICoreBrowserService private readonly _coreBrowserService: ICoreBrowserService
+    @ICoreBrowserService private readonly _coreBrowserService: ICoreBrowserService,
+    @IDecorationService decorationService: IDecorationService
   ) {
-    super(container, 'cursor', zIndex, true, colors, rendererId, bufferService, optionsService);
+    super(container, 'cursor', zIndex, true, colors, rendererId, bufferService, optionsService, decorationService);
     this._state = {
       x: 0,
       y: 0,
diff --git a/src/browser/renderer/LinkRenderLayer.ts b/src/browser/renderer/LinkRenderLayer.ts
index 2492f921..15086d9a 100644
--- a/src/browser/renderer/LinkRenderLayer.ts
+++ b/src/browser/renderer/LinkRenderLayer.ts
@@ -8,7 +8,7 @@ import { BaseRenderLayer } from './BaseRenderLayer';
 import { INVERTED_DEFAULT_COLOR } from 'browser/renderer/atlas/Constants';
 import { is256Color } from 'browser/renderer/atlas/CharAtlasUtils';
 import { IColorSet, ILinkifierEvent, ILinkifier, ILinkifier2 } from 'browser/Types';
-import { IBufferService, IOptionsService } from 'common/services/Services';
+import { IBufferService, IDecorationService, IOptionsService } from 'common/services/Services';
 
 export class LinkRenderLayer extends BaseRenderLayer {
   private _state: ILinkifierEvent | undefined;
@@ -21,9 +21,10 @@ export class LinkRenderLayer extends BaseRenderLayer {
     linkifier: ILinkifier,
     linkifier2: ILinkifier2,
     @IBufferService bufferService: IBufferService,
-    @IOptionsService optionsService: IOptionsService
+    @IOptionsService optionsService: IOptionsService,
+    @IDecorationService decorationService: IDecorationService
   ) {
-    super(container, 'link', zIndex, true, colors, rendererId, bufferService, optionsService);
+    super(container, 'link', zIndex, true, colors, rendererId, bufferService, optionsService, decorationService);
     linkifier.onShowLinkUnderline(e => this._onShowLinkUnderline(e));
     linkifier.onHideLinkUnderline(e => this._onHideLinkUnderline(e));
 
diff --git a/src/browser/renderer/SelectionRenderLayer.ts b/src/browser/renderer/SelectionRenderLayer.ts
index 9054e3ca..be911eb9 100644
--- a/src/browser/renderer/SelectionRenderLayer.ts
+++ b/src/browser/renderer/SelectionRenderLayer.ts
@@ -6,7 +6,7 @@
 import { IRenderDimensions } from 'browser/renderer/Types';
 import { BaseRenderLayer } from 'browser/renderer/BaseRenderLayer';
 import { IColorSet } from 'browser/Types';
-import { IBufferService, IOptionsService } from 'common/services/Services';
+import { IBufferService, IDecorationService, IOptionsService } from 'common/services/Services';
 
 interface ISelectionState {
   start?: [number, number];
@@ -24,9 +24,10 @@ export class SelectionRenderLayer extends BaseRenderLayer {
     colors: IColorSet,
     rendererId: number,
     @IBufferService bufferService: IBufferService,
-    @IOptionsService optionsService: IOptionsService
+    @IOptionsService optionsService: IOptionsService,
+    @IDecorationService decorationService: IDecorationService
   ) {
-    super(container, 'selection', zIndex, true, colors, rendererId, bufferService, optionsService);
+    super(container, 'selection', zIndex, true, colors, rendererId, bufferService, optionsService, decorationService);
     this._clearState();
   }
 
diff --git a/src/browser/renderer/TextRenderLayer.ts b/src/browser/renderer/TextRenderLayer.ts
index 33d942ff..e0f6d831 100644
--- a/src/browser/renderer/TextRenderLayer.ts
+++ b/src/browser/renderer/TextRenderLayer.ts
@@ -11,7 +11,7 @@ import { AttributeData } from 'common/buffer/AttributeData';
 import { NULL_CELL_CODE, Content } from 'common/buffer/Constants';
 import { IColorSet } from 'browser/Types';
 import { CellData } from 'common/buffer/CellData';
-import { IOptionsService, IBufferService } from 'common/services/Services';
+import { IOptionsService, IBufferService, IDecorationService } from 'common/services/Services';
 import { ICharacterJoinerService } from 'browser/services/Services';
 import { JoinedCellData } from 'browser/services/CharacterJoinerService';
 
@@ -37,9 +37,10 @@ export class TextRenderLayer extends BaseRenderLayer {
     rendererId: number,
     @IBufferService bufferService: IBufferService,
     @IOptionsService optionsService: IOptionsService,
-    @ICharacterJoinerService private readonly _characterJoinerService: ICharacterJoinerService
+    @ICharacterJoinerService private readonly _characterJoinerService: ICharacterJoinerService,
+    @IDecorationService decorationService: IDecorationService
   ) {
-    super(container, 'text', zIndex, alpha, colors, rendererId, bufferService, optionsService);
+    super(container, 'text', zIndex, alpha, colors, rendererId, bufferService, optionsService, decorationService);
     this._state = new GridCache<CharData>();
   }
 
@@ -176,6 +177,19 @@ export class TextRenderLayer extends BaseRenderLayer {
         nextFillStyle = this._colors.ansi[cell.getBgColor()].css;
       }
 
+      // Get any decoration foreground/background overrides, this must be fetched before the early
+      // exist but applied after inverse
+      const decorations = this._decorationService.getDecorationsOnLine(y);
+      for (const d of decorations) {
+        const xmin = d.options.x ?? 0;
+        const xmax = xmin + (d.options.width ?? 1);
+        if (x >= xmin && x < xmax) {
+          if (d.backgroundColorRGB) {
+            nextFillStyle = d.backgroundColorRGB.css;
+          }
+        }
+      }
+
       if (prevFillStyle === null) {
         // This is either the first iteration, or the default background was set. Either way, we
         // don't need to draw anything.
diff --git a/src/browser/renderer/atlas/DynamicCharAtlas.ts b/src/browser/renderer/atlas/DynamicCharAtlas.ts
index 88194615..678f8b70 100644
--- a/src/browser/renderer/atlas/DynamicCharAtlas.ts
+++ b/src/browser/renderer/atlas/DynamicCharAtlas.ts
@@ -105,7 +105,7 @@ export class DynamicCharAtlas extends BaseCharAtlas {
     this._cacheMap.prealloc(capacity);
 
     // This is useful for debugging
-    // document.body.appendChild(this._cacheCanvas);
+    document.body.appendChild(this._cacheCanvas);
   }
 
   public dispose(): void {
diff --git a/src/browser/renderer/dom/DomRendererRowFactory.ts b/src/browser/renderer/dom/DomRendererRowFactory.ts
index 7a20db5a..3a8bf87c 100644
--- a/src/browser/renderer/dom/DomRendererRowFactory.ts
+++ b/src/browser/renderer/dom/DomRendererRowFactory.ts
@@ -173,7 +173,8 @@ export class DomRendererRowFactory {
         bgColorMode = temp2;
       }
 
-      // Apply any decoration foreground/background overrides
+      // Apply any decoration foreground/background overrides, this must happen after inverse has
+      // been applied
       const decorations = this._decorationService.getDecorationsOnLine(row);
       let bgOverride: IColor | undefined;
       let fgOverride: IColor | undefined;